(By Retail Sails) Gas prices have retreated for 11 consecutive weeks, falling 40.8 cents or 10.4% since hitting a peak of $3.941 in the first week of April. This is certainly a positive for consumers heading into the summer driving months, and bolsters discretionary spending power.
On the other hand, the share of households viewing the economy as heading in the right direction fell to 22% this month, the lowest since January according to Bloomberg.
"The steady drip of dreary economic data and deteriorating labor market is reshaping public expectations," said Bloomberg LP senior economist Joseph Brusuelas in New York. The decline "will likely result in slower spending, which in turn will likely have an adverse impact on business confidence."
Economic worries and weakness in the job market is overshadowing any positive effects of falling prices at the pump, especially for lower-income consumers.
"The lower income earners have really turned sour, suggesting that they are the cohort likely losing jobs and partially explains why they have not responded favorably to the drop in gasoline prices," Brusuelas said.